Costello says NAB customers should shop around

Federal Treasurer Peter Costello has urged consumers to shop around if they are not happy with the National Australia Bank's move to cut the value of credit card holders' Qantas frequent flyer points.

Mr Costello said the federal government had referred the matter to the Australian Competition and Consumer Commission (ACCC) to ensure NAB had properly informed its clients on the change in their frequent flyer terms and conditions.

He said ACCC chairman Allan Fels would look closely at whether there was a retrospective element to the bank's new policy.

"If people feel that the National Australia Bank has got their custom by promising a generous scheme which is less generous now, then one of the things they can do to make their voice felt is to go to another bank," Mr Costello told reporters.

"I notice other banks have indicated they will not be following suit and I keep saying to customers and consumers `you have got customer power'.");document.write("

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"If you feel that your bank has let you down go to another one, banks certainly get the message."

NAB has told its 150,000 Gold Rewards customers it was slashing a third off the value of accumulated points, and that the move was retrospective.

The consumer watchdog today wrote to the country's biggest bank, seeking an explanation for the changes to its rewards program.

"In particular, the ACCC has queried changes to the redemption rate for National Gold Rewards members who are also Qantas Frequent Flyer members," Professor Fels said.

NAB has until Friday to respond, he said.

"The ACCC indicated that it is concerned that by changing the redemption rate NAB may have misled consumers and may have misrepresented the value, characteristics, uses or benefits of the consumer's National Rewards points," Prof Fels said.

From June 15, NAB customers will need to redeem 1.5 National Gold Rewards points to earn one Qantas Frequent Flyer point.

The Australian Consumers Association (ACA) earlier warned that NAB's move could prompt customers to switch banks.